Quality Assurance Agency for Higher Education One hundred and sixth meeting of the Board of Directors Unconfirmed minutes of the meeting on 13 December 2017, 11.00-13.00 QAA Southgate House, Southgate Street, Gloucester, GL1 1UB. Open business Present Members: Mr Christopher Banks (Chair) Professor Joy Carter Mr Robert Cashman Mr Stephen Criddle Professor Maria Hinfelaar Mr Oliver Johnson Professor Denise McAlister Mr Jon Prichard Professor Andrew Wathey (items 1-6) Mr Philip Wilson Professor Philip Winn Apologies Members: Professor Tim McIntyre-Bhatty Mr Amatey Doku Ms Linda Duncan Professor John Grattan Professor Craig Mahoney In attendance Officers: Mr Douglas Blackstock (CEO) Miss Lavinia Blackett Mrs Natalie Haines Mr Ian Kimber Ms Gemma Long Mr Will Naylor Ms Rowena Pelik Mrs Liz Rosser Ms Helen Smith Company members' representatives: Mr Alex Bols (GuildHE) Mr William Hammonds (UUK) Observers: Mr Scott Court (HEFCE) Mr Ben Elger (OIA) Mr Alex Proudfoot (Study UK) 1
Welcome and apologies 1. The Chair welcomed members, officers and company member representatives to the meeting, and noted apologies. The Chair reiterated the Board s priorities as agreed at the October 2017 away day: Maintaining the UK-wide framework for quality in Higher Education Protecting quality during a period of transition and change Relationships with key external stakeholders Balancing the Agency s regulatory and commercial activities (with a focus on international activities). 2. These priorities would be woven into this and future Board agendas. Quorum and interests Quorum and interests (item 2) 3. The meeting was declared quorate. No interests were declared. Minutes from the meeting held on 11 October 2017 (item 3, BD-2017-63) 4. The minutes of the open business of the meeting held on 11 October 2017 were approved as a true and accurate record of the meeting. 5. There were no matters arising from the minutes not otherwise on the agenda. Discussion items Chief Executive s report (item 5, BD-2017-64) 6. The Board noted the Chief Executive s report on recent policy developments. The Chief Executive highlighted the following: Scotland - Dr Mike Cantlay OBE had been appointed as the new Chair of the Scottish Funding Council. QAA had written to Dr Cantlay to welcome him to the post. Wales - QAA had received a letter from the Cabinet Secretary for Education in Wales providing comment on the Quality Code consultation and an update on developments for future quality arrangements in Wales, including reforms to postcompulsory education and training (PCET). UK Quality Code: consultation In October 2017, QAA and the UK-wide Standing Committee for Quality Assessment (UKSCQA) had opened a consultation on the future development of the UK Quality Code. QAA had run five consultation events during November and December 2017 in Belfast, Cardiff, Glasgow, London and Manchester, attended by approximately 390 delegates. The consultation closed on 14 December 2017. 127 completed responses had been received from a range of institutions and individuals. [Post meeting note: 265 completed responses were received by the close of consultation]. Responses were being analysed but early themes emerging from the responses and feedback from the events included engagement, enhancement, employability and externality. The outcomes would be reported at the next meeting of the UKSCQA in late January 2018. In his capacity as Chair of the UKSCQA, Professor Wathey 2
thanked QAA and the staff involved for their input and coordination of the consultation. 2018 ENQA review of QAA The review of QAA by the European Association for Quality Assurance in Higher Education (ENQA) would take place in February 2018. Department for Education consultations: QAA responses (item 6, BD-2017-65) 7. Mr Kimber introduced a paper regarding the recent Department for Education consultations on the new regulatory framework for England. He confirmed that QAA would be formally responding to two of the five consultations; Securing Student Success and Simplifying Access to the Market. Drafts of both responses had been previously circulated to Board members in November 2017 for comment. The final versions presented at the meeting incorporated comments received from Board members and key stakeholders. 8. The Board considered each response in detail, and in particular, how Access to HE and TNE related to the Office for Students (OfS) regulatory framework, given that neither featured heavily in the consultation document but were part of wider UK arrangements. 9. During discussion, the following points were raised in relation: The issue of cross-border collaborative provision and franchise provision was not adequately addressed in the consultation document and should be highlighted in the response. Clarity should be requested on the future place of embedded and pathway colleges in the regulatory framework. QAA s response should be revisited in light of the National Audit Office report on value for money in higher education. For both Access to HE and TNE, it was the consensus view that they should be acknowledged as key part of the broader regulatory framework and delivered by a body with a UK-wide remit. 10. It was noted that the Student Advisory Group would be preparing a separate response to the consultation documents. 11. Following discussion the Board: a) Approved the consultation responses provided subject to amendments proposed. b) Delegated authority to the Chief Executive to approve and submit the response on behalf of the Board. Degree Awarding Powers reform and the evolution of the work of ACDAP (item 7, BD-2017-66) 12. The Board received a paper prepared by Mr Naylor regarding the government s reforms to degree awarding powers and role of the Board s Advisory Committee on Degree Awarding Powers (ACDAP). 13. Mr Naylor informed the Board that the government s proposed reforms in England aimed to make it quicker and easier for providers who could demonstrate high quality to secure degree awarding powers. As such, if QAA were to become the designated 3
quality body under the Higher Education and Research Act it would need to respond to these changes by reforming its current processes for reviewing applications for degree awarding powers in order to speed up the consideration of applications and deal with a potential increase in the volume of applications. 14. Mr Naylor reported that QAA s current model for considering applications had been reviewed by officers and proposals setting out a revised model of delegated authorities and a new method for assessing and advising the OfS considered by ACDAP at its last meeting. The proposed changes aimed to increase the speed, agility, flexibility and efficiency of QAA s processes while retaining rigor. 15. The Board was asked to consider the following proposed changes: a) To delegate to QAA officers the authority to decide whether applications should proceed to detailed scrutiny and monitor the progress of scrutiny activity. This role was currently being undertaken by the Committee itself. b) For the Board to delegate authority to a standing committee of its members to provide the final advice on degree awarding powers directly to the Office for Students thereby expediting the advice and reducing the current turn around period for applications. 16. The Board: a) Agreed the proposed changes to delegated authorities as set out above subject to the approval by the Board at its meeting in March 2018 of revised terms of reference for ACDAP. b) Agreed to the establishment of a QAA Board standing committee to provide final advice to the OfS subject to the approval by the Board of the terms of reference and reporting arrangements. 17. The Board concluded that there may be need for further review of the Committee if QAA became the designated quality body. Audit Committee s annual report to the Board, including approval of the Annual report and consolidated financial statements (item 8, BD-2017-67) 18. The Board was provided with the Audit Committee s annual report to the Board. 19. Mrs Rosser reported that the main item of discussion at the November 2017 Audit and Risk Committee meeting had been the Annual Report and Consolidated Financial Statements for the year ended 31 July 2017, which needed to be approved by the Board prior to the 2017 AGM. The financial statements were consolidated and included the results for QAA Enterprises Limited. The financial statements for QAA Enterprises Limited had been approved at its Directors meeting on 5 December 2017. Mrs Rosser confirmed that the report and accounts had been prepared in line with the requirements of the Charities Statement of Recommended Practice (SORP) 2015 and Financial Reporting Standard (FRS) 102. The report and accounts had also been circulated to the full Board in draft form for comment, prior to the Audit and Risk Committee, and reviewed by the Honorary Treasurer. 20. A summary version of the Annual report had been prepared for publication in early 2018 and was tabled at the meeting. 4
21. Mrs Rosser highlighted to the Board that the external auditors would be returning an unqualified opinion on the accounts, and that there were no systems or controls issues identified in the Audit Findings Report. The overall control environment remained strong despite a significant decrease in the number of staff in the finance department as a result of the organisational restructure. The Board agreed that the outcome of the external audit was very positive. 22. It was further reported that management and the Audit and Risk Committee continued to be content with both the work, and the expertise of, the external auditors and would recommend retaining their services subject to Company Members approval. 23. On behalf of the Board, the Chair extended his thanks to the Finance Department and Audit and Risk Committee for their work. 24. Having considered the reports submitted, the Board: a) Noted the Annual report from Audit Committee to Board b) Approved, subject to minor amendments, the Annual report and consolidated financial statements for the year ended 31 July 2017 for presentation to the AGM (BD-2017-8b) c) Authorised the Chair to sign the Annual report and financial statements and the letter of representation on its behalf (BD-2017-8c) d) Noted the financial statements of QAA Enterprises Limited (BD-2017-8d) e) Noted the external auditor s Audit Findings Report (BD-2017-8e) f) Noted the internal audits conducted during the year (BD-2017-8f) g) Noted the evaluation of the auditors (paragraph 3) and recommended to the AGM the re-appointment of the external auditors. Financial Update (item BD-2017-74) 25. Mrs Rosser introduced a paper highlighting the key financial developments since the last meeting of the Board. It was reported that, to retain oversight of financial matters on behalf of the Board, the Honorary Treasurer had engaged in regular dialogue with the Director of Resources, was a member of the Audit and Risk Committee, and had been involved in the development of the new internal audit strategy. 26. The paper provided the latest financial position and highlighted that for the first three months of the year to 31 October 2017, the actual results showed a deficit of 13k; an improvement on budget of 70k. 27. It was noted that a number of requests for additional pay and non-pay expenditure had been received since the budget was set. These would be funded both through the Innovation and Development fund and the operating budget. The impact of the approved requests would be monitored and reflected in the Term 1 forecast. 28. The paper also provided an update on: Resourcing strategies which had been developed to underpin the delivery of QAA s Strategy Building on World-Class Quality; Premises: renegotiation of the lease arrangements for Southgate House; 5
USS and SAUL pension schemes. 29. Mrs Rosser reported that the Agency s investments advisers wished to revisit the Board s appetite to risk in this area. Mr Wilson, Mr Johnson and Mr Criddle volunteered to be involved in this alongside the Honorary Treasurer on behalf of the Board. Future Fees and Subscriptions Update (item BD-2017-75) 30. The Board received an update and paper on future fees and subscriptions prepared by Mrs Rosser. It was noted that in March 2017, the Board approved QAA s proposal to retain the current subscription models and charges for up to two years during the transition period to the new Regulatory Framework in 2019-20. This was subsequently discussed with, and endorsed by the relevant UK Higher Education representative bodies. It was proposed to continue with the current subscription model and rates to July 2019 for all nations. Confirmation that this was still an acceptable position had been received from the following: UUK, GuildHE, Universities Wales, Universities Scotland, Independent HE and the Association of Colleges. 31. The Board: a) Noted the updated timeline for development of new models and consultation with the sector. New models were being developed and would be refined in the coming months once QAA had a better understanding of the activities and responsibilities that would be delivered by the Designated Quality Body. b) Agreed the proposal to keep the Honorary Treasurer informed / involved as necessary between formal Board meetings. c) Requested that a progress report be provided to the March 2018 and June 2018 meetings of the Board with the final proposals presented for approval in October 2018 in advance of formal consultation with the sector. Appointments to the Board and Board committees (item 11, BD-2017-76) 32. The Board approved the following appointments to the QAA Board and Board Committees: a) to the Board Mr Craig Watkins pursuant to Article 46 (iii), in the membership category Independent member for an initial three year term from 13 December 2017. Dr Vanessa Davies pursuant to Article 46 (iii), in the membership category Independent member for an initial three year term from 13 December 2017. A further appointment in this category would be discussed in the closed session. b) to the QAAE Board Ms Linda Duncan as a QAA Board appointment to the QAA Enterprises Board for an initial three-year term with effect from 13 December 2017. c) to the Audit and Risk Committee Mr Craig Watkins (for an initial three year term from 13 December 2017). Mr Watkins would act as Chair of the Audit Committee from May 2018. 6
33. The Board noted that Mr Prichard would be retiring from the Board on 23 January 2018. The Chair thanked Mr Prichard and extended the Board s appreciation for his dedication, valued experience and fantastic contribution to the work of the Agency over his six year term. Mr Prichard extended his thanks to the Board for his time with them stating that it was an absolute privilege to have been involved in the work of the Agency. Governance (item 12) 34. Board member code of best practice (BD-2017-77) - The Board considered a revised code of best practice for QAA Board and Committee Members. The revised handbook included a summary of guidance on the Agency s governance structure and procedures, provided links to more detailed information and would be used as part of the induction pack for new Board members. On the advice of the Nomination and Remuneration Committee, the Board: Approved the revised code of best practice. 35. Matters reserved to the Board (BD-2017-78) - The Board considered a revised Schedule of Matters Reserved to the Board which set out the decision-making authorities that could only be exercised by the Board. The Schedule had been updated in line with recommendations from the last governance review and the recent review of Board Committee terms of reference. On the advice of the Nomination and Remuneration Committee, the Board: Approved the revised Schedule of Matters reserved to the Board. Authorised the Chief Executive and Secretary to make any minor amendments required to reflect decisions taken at the meeting in relation to the delegation of responsibilities for DAP. 36. Governance Review Working Group Closure report (BD-2017-79) - The Board received a paper from Miss Blackett recommending the closure of the Governance Review Working Group (GRWG). The GRWG was established by the Board as a task and finish group to conduct a formal review of QAA s governance structures in response to changes in the Higher Education Sector and QAA s role. Given that the Group had concluded the tasks as set out in its terms of reference and that there were no major changes to the Agency s governance expected in the near future, it was proposed that the GRWG be disbanded with any remaining activities allocated to the Board/Board Committees as appropriate. The Board: Approved that the GRWG be disbanded with immediate effect. 37. Governance of QAA Enterprises (BD-2017-80) The Board received a paper prepared by Miss Blackett on the governance arrangements for QAAE, the whollyowned subsidiary of QAA. An increase in trading activity was anticipated further to the Board s approval of the Innovation and Enterprise Strategy, with much of the prospective activity constituting consultancy and advisory work. It was reported that in preparation for this increase, and for potential designation, QAA was taking measures to ensure appropriate separation of commercial and regulatory activities and to minimise the risk of perceived conflicts of interest including the revision of the current Memorandum of Agreement between QAA and QAAE. 38. At its meeting in December 2017 the QAAE Board had requested that, in the interests of operational efficiency, a small amendment be made to QAAE s Articles of 7
Association to introduce greater flexibility into the provisions governing the frequency of meetings. 39. The Board: Approved that the Board of QAAE should normally meet twice a year and otherwise as required. Authorised the Director of Resources to execute the revised service sharing agreement between QAA and QAAE. 40. Miss Blackett confirmed that the minutes of QAAE Board meetings were available to all Board members via the Trustee website. Reporting items Update on Welsh Language Standards (item 13, BD-2017-81) 41. The Board received an update paper prepared by Mrs Pelik on the Agency s compliance with the Welsh Language Standards. In July 2016 QAA had received a compliance notice from the Welsh Language Commissioner, detailing the Standards with which it must comply, the extent to which they applied, and setting deadlines for the imposition of each Standard. Since receiving the notice QAA had engaged constructively with the Commissioner s Office with a view to clarifying and finalising the extent of the duties imposed. These negotiations had taken 16 months and QAA and the Commissioner had reached an agreed position in respect of the 112 Standards to which the Agency was subject. 42. The Standards set out detailed requirements for record keeping, policy-making, publishing information, monitoring and reporting. An annual report would be produced in Welsh for each financial year detailing how the Standards had been met. It was proposed that the Audit and Risk Committee would oversee this activity on behalf of the Board. 43. Ms Pelik reported that there were considerable cost implications involved in meeting the Standards. These included translation costs, the design and content of webpages in Welsh, also record keeping, development, time and opportunity costs. In addition, review teams in Wales would likely need to have at least one Welsh speaker and be able to conduct some or all of their meetings with providers in Welsh. 44. The Board: a. noted the importance of the Agency s approach to the Welsh language for QAA b. agreed the proposed reporting to Audit and Risk Committee. 45. The Board extended their thanks to Ms Lindsay Heaven for her help and contribution to QAA s work in this area. Summary report from Board committee meetings (item 14, BD-2017-82) 46. The Board received and noted the summary report of Board Committee meetings held since October 2017. Any other business There being no other business, the Chair closed the meeting. 8